Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please answer all required parts Gallatin Carpet Cleaning has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is

image text in transcribedimage text in transcribed

Please answer all required parts

Gallatin Carpet Cleaning has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $13.05 per hundred square feet. However, there is some question about whether the company is making a profit on jobs requiring considerable travel time. The owner's daughter suggested answering this question by designing an activity-based costing system using the information shown below: The total cost of operating the company for the year is $349,000 which includes the following costs: She distributed these operating costs across her four activities as follows: Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on. Required: 1. Prepare the first-stage allocation of costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. The company recently completed a 600 -square-foot carpet-cleaning job at the Flying N Ranch-a 54-mile round-trip from the company's home office. Compute the cost of this job using the activity-based costing system. 4. The revenue from the Flying N Ranch was $78.30 (600 square feet @$13.05 per hundred square feet). Calculate the customer margin earned on this job. Complete this question by entering your answers in the tabs below. Prepare the first-stage allocation of costs to the activity cost pools

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions